With units and apartments making up almost 90% of homes in Darling Point, if you’re buying property here, chances are you’re going to encounter either a strata title or a company title building.
Let’s have a look at the differences between the two different systems of ownership.
What is a strata title?
Today, strata title is the most common form of property title for Australian apartments, units, townhouses and semi-detached properties.
It was introduced in NSW in 1961 to give owners individual titles to a part of a building, such as a unit or an apartment. Under strata title, people own their apartment (known as a ‘lot’) individually and share ownership of common areas such as hallways, lobbies, lifts, exterior walls, common gardens and even roofs.
An owners’ corporation and strata committee organise the maintenance of the common property, building insurance, bylaws, finances and so on. The cost of maintaining the building and common property is covered by the quarterly fees paid by owners, while special levies may be raised to cover additional or large works.
What owners need to know about strata title
When you own a strata title unit, you’ll be required to pay regular strata fees (usually quarterly), and any special levies for major works if needed.
As an owner, you are automatically part of the owners’ corporation, also known as the body corporate. You can also choose to nominate for the strata committee, the elected group that manages the day-to-day running of the scheme. Being part of the committee is a good way to get involved with the decisions being made for the building.
Strata unit owners are obliged to comply with the building’s bylaws. There are standard NSW bylaws, but each owners’ corporation has the right to implement its own special bylaws. They can relate to all sorts of issues, including whether pets are allowed, noise restrictions and whether the laundry is allowed on balconies. It’s wise to check a building’s bylaws before you buy into it.
What is a company title?
Before strata title, there was company title, devised in New York in the 1880s and the norm in apartment buildings across Sydney until the 1960s. It has since largely been replaced by strata, but it’s still common in historic areas that are home to apartments built before 1960, like Darling Point.
Unlike strata, owners of company title units don’t receive an individual title for their property. Instead, they own shares in the company that owns the entire building. The shares give them the exclusive right to live in their apartment.
Before buying a property with a company title, it’s a good idea to familiarise yourself with the company’s constitution. Some will limit who can buy into the building or have rules about renting the apartments or what changes can be made to the properties. Some Darling Point company title buildings have their own websites to help answer questions from prospective and current owners. Many company title owners really value the sense of community that the cooperative ownership of the building fosters.
What owners need to know about company title
Because company title is not always well understood, buyers are sometimes wary of it, and in the past, company title apartments were considered less valuable than those with strata title. Given the ferocity of Sydney’s current property market, whether that remains the case is debatable. Lenders have also been historically cautious about loaning money for a company title unit, with the maximum amount they are willing to lend typically hovering around the 80% mark.
The upshot is that company title apartments can represent good value for money. In some cases, owners have been known to increase the value of their investment instantly by converting their building to a strata title.
Company title in Darling Point
There are many company title apartment buildings in Darling Point, ranging from modest units to highly sought-after luxury harbourside residences.
One of the most prominent company title buildings in Darling Point is the iconic Yarranabbe Gardens at 87-97 Yarranabbe Road. Apartments here are regularly snapped up by astute buyers looking for a stylish slice of the Darling Point harbourside lifestyle.
Nevada on Darling Point Road, Easthaven on Sutherland Crescent, Santina on Yarranabbe Road and 10 Etham Avenue at the tip of the Darling Point peninsula are all examples of coveted company title apartment buildings in Darling Point.
My team and I regularly assist people to buy and sell both strata and company title units and apartments in Darling Point. If you’re looking for advice about strata or company title properties in our area, please always feel welcome to contact me at any time.